Grain system posts strong year for deliveries

After years of complaints about delays, most people are happy 
with the grain marketing system this year with booming deliveries

Apparently, no news is good news in the grain business.

An odd silence exists around the prairie grain marketing and handling system this year, but after several years that saw complaints about delays and poor service, nobody is complaining.

Farmer deliveries are up more than 20 percent at this point of the year compared to 2012-13 and exports are up more than 30 percent.

“It’s been fantastic for the farmer,” said Gerrid Gust, who farms near Davidson, Sask., and is active in farm organizations.

“It’s been great.”

John Duvenaud, a marketing adviser and analyst who publishes the Wild Oats newsletter, agreed.

“We’re in heaven here.

“Everything’s working,” he said.

The system’s strong performance in clearing Western Canada of its crops is particularly notable considering the glutted world grain markets.

“This is a time when (wheat) is piling up in the rest of the world, so I’d say our system is working pretty darned well right now,” said Duvenaud.

Analysts attribute the excellent grain movement to:

  • a warm winter causing few logistical breakdowns
  • less aggressive competition from competing commodities such as potash and oil for rail
  • grain company and railroad improvements in handling systems and abilities to move grain
  • a medium sized crop

The main noticeable feature for farmers has been their ability to move whatever crops they want without having to search too far to find a buyer.

In some winters, certain crops have hot demand and some can’t be moved for long periods at anything other than deep discount prices.

That skews crop clearance and forces many farmers to market not what they want or need to move but whatever the market seems to want.

This winter, farmers have found buyers willing to at least consider taking most crops, which allowed them to move what they wanted when they wanted.

“Everything’s been pretty good,” said FarmLead operator Brennan Turner.

“There’s been good movement. We haven’t really seen any snags.”

Most pulse crops will be gone by the end of the crop year, canola bins will mostly be swept clean and little wheat will be left on the Prairies.

At the same time, the U.S. grain system will still have large amounts of old crop wheat that need to move through the system when the new crop is harvested.

It’s a nice time for the Canadian grain system, especially coming so soon after the 2013-14 logistical nightmare.

“We’re moving a lot of grain, we really are,” said Cam Dahl, president of Cereals Canada.

“It has been ideal conditions all around, from the logistics through to the marketing side.”

It’s hard to find anyone willing to guarantee that this kind of performance will continue because the year has had a unique combination of positive factors.

However, farmers are currently enjoying the difference from years like 2013-14, when everything seemed bad.

“A couple of years ago if you said ‘no’ (when a grain buyer called), they’d just go to the next guy on the list and you were back at the bottom and everything was screwed up,” said Gust.

“Now, there’s not much grain left in the country and (farmers) aren’t near as desperate.”

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